BAFL 45.66 Increased By ▲ 0.56 (1.24%)
BIPL 20.08 Decreased By ▼ -0.17 (-0.84%)
BOP 5.34 Decreased By ▼ -0.06 (-1.11%)
CNERGY 4.54 Increased By ▲ 0.01 (0.22%)
DFML 16.01 Increased By ▲ 0.33 (2.1%)
DGKC 78.62 Increased By ▲ 5.74 (7.88%)
FABL 27.80 Increased By ▲ 0.65 (2.39%)
FCCL 18.86 Increased By ▲ 1.21 (6.86%)
FFL 8.96 Decreased By ▼ -0.13 (-1.43%)
GGL 12.85 Increased By ▲ 0.21 (1.66%)
HBL 111.54 Increased By ▲ 0.88 (0.8%)
HUBC 122.23 Increased By ▲ 0.71 (0.58%)
HUMNL 7.69 Increased By ▲ 0.34 (4.63%)
KEL 3.29 Increased By ▲ 0.06 (1.86%)
LOTCHEM 27.80 Increased By ▲ 0.48 (1.76%)
MLCF 42.36 Increased By ▲ 3.03 (7.7%)
OGDC 110.37 Increased By ▲ 2.37 (2.19%)
PAEL 18.97 Increased By ▲ 1.41 (8.03%)
PIBTL 5.46 No Change ▼ 0.00 (0%)
PIOC 114.91 Increased By ▲ 6.91 (6.4%)
PPL 94.72 Increased By ▲ 2.97 (3.24%)
PRL 25.32 Increased By ▲ 0.44 (1.77%)
SILK 1.10 Increased By ▲ 0.02 (1.85%)
SNGP 64.32 Increased By ▲ 1.22 (1.93%)
SSGC 12.26 Increased By ▲ 0.37 (3.11%)
TELE 8.36 Increased By ▲ 0.17 (2.08%)
TPLP 13.35 Increased By ▲ 0.24 (1.83%)
TRG 83.84 Increased By ▲ 2.23 (2.73%)
UNITY 25.89 Increased By ▲ 0.14 (0.54%)
WTL 1.54 Increased By ▲ 0.02 (1.32%)
BR100 6,308 Increased By 126.6 (2.05%)
BR30 21,973 Increased By 434.1 (2.02%)
KSE100 61,691 Increased By 1160 (1.92%)
KSE30 20,555 Increased By 366.1 (1.81%)

EDITORIAL: The National Price Monitoring Committee’s (NPMC’s) revelation of a 40 percent differential in wholesale and retail prices of basic food items is shocking, to say the least.

It means there has been no effort to check the age-old trend of middleman manipulation, which includes everything under the sky from hoarding, price fixing and blatantly violating the law of the land.

And it is shameful that the Committee has seemingly brushed this issue aside, for all intents and purposes, by simply directing ministries, departments, and provinces to “remain vigilant and reduce the price difference by improving supplies and overcoming hoarding”.

This betrays a troubling divorce from reality and raises at least two very important points. One, it is not the supply of commodities, or the lack thereof, that widens the trade price cleavage between wholesale and retail markets. The credit goes to unscrupulous elements that would never function so openly without protection from parts of the official machinery. You could raise supplies in a number of ways – all of which would burden the exchequer, of course – but only end up benefitting the mafias and interest groups that control the retail market.

And two, why hasn’t anybody ordered a very severe crackdown on everybody involved in this practice? Surely, NPMC is aware that these are times of unprecedented inflation, not to mention unemployment, and food inflation is still highest among the CIP basket.

So it must also understand that appreciating a drop in the differential from 70pc to 40pc and then getting on with business as usual amounts to rubbing salt in the wounds of a very angry public.

It’s also been reported that the retail market is not reflecting the drop in commodity prices in global markets. Ghee/cooking oil, for example, became more expensive by 4pc in the local market when palm oil prices dropped by 9pc in the international market.

Since this happened at a time when the economy is in deep crisis and the government is bending over backwards for each dollar in international aid it can get, this kind of negligence merits action not just against distortive elements in the retail market but also government watchdogs that were either asleep at the wheel or in on the act.

Yet NPMC officials still “expressed satisfaction over the stabilisation of prices of essential items”. Ordinary people who are already forced to pay ridiculously inflated bills and also unfairly expensive food might have something to say about such statements. It’s clear that the arm of the government meant to monitor and control prices is not only failing in its job, but is also unaware of its real responsibility.

Yet now that the biggest reason for food inflation is known, one can only hope that offices higher than NPMC will take note of this miscarriage of justice. Since everybody tends to jump into effective action at IMF-review time, and one is going on right now, there is some hope that headlines will tell of very serious action against price manipulators soon enough.

Anything less would be a disservice to the nation and an insult to the people who are forced to pay, quite literally, for the mistakes, bad policies, and outright corruption of successive administrations.

Copyright Business Recorder, 2023


Comments are closed.

Abdullah Nov 09, 2023 07:13am
Sorry i do not agree that the biggest reason of food price inflation is the middle man, it is the government's monetary policies, at interest rates sky rocketing at 22% how do you think any investor in any business would want to shrink their margins? Goods that cost 100 rupees today will be worth 122 rupees a year later, that's what 22% interest rates mean. Our whole economic model is flawed, in a country where most people believe that Riba is Haram, we try to copy past economic policies from 1st world countries, hoping that they would work here, and we have not learned any thing since the last 70 years. The basic requirement of successful a economic model is that it should reflect the values of the society and that it should motivate the citizens to work hard with honesty and integrity.
thumb_up Recommended (0)
wanker Nov 09, 2023 11:23am
It's a free market economy. They are allowed to set their own prices. Anything else will make things worse not better. Wherever we have price controls in the economy we have shortages. Just look at the market for electricity and gas.
thumb_up Recommended (0)
KU Nov 09, 2023 11:54am
It's not shocking but simply shameful, especially for the Raj who are partners in this artificial prices. If only law was to take it's course, many would be behind bars, but in our country every rule is neutralised, maybe software update needed on urgent basis.
thumb_up Recommended (0)
bonce Nov 09, 2023 06:30pm
@KU, Agreed with you.
thumb_up Recommended (0)
Qudrat Nov 11, 2023 09:58pm
@Abdullah, agree
thumb_up Recommended (0)
Qudrat Nov 11, 2023 10:07pm
I think that it is totally government instability and state bank of Pakistan that fail to governor on his policies.But,state bank of Pakistan claim that this is the government instability.Look to other countries how the overcome on such kind of situations I give simple example of US when he facing to Ecnomics crices in 2008 when their economy downturn but US administration directly passed reinvestment and recovery Acts and cutting this situation.From 2001 to 2009 Bush era and 2009 to 2019 Obama era he established banking bailout system and kenysain stimulus which aims to increase government spending itself and decreases interest rate bring to zero in this way he overcome on this situation..So I hope that government of Pakistan and state bank adopted and study situation, according to situation he change in fiscal and monetary policy and give preference to competent Ecnomics during changes of poliies
thumb_up Recommended (0)

One big reason for food inflation

Pakistan’s trade deficit narrows 34% to $9.38bn in 5MFY24

KSE-100 conquers 61,000 after single-day gain of 1,160 points

COP28: UAE president announces $30bn fund to bridge climate finance gap

Israel resumes Gaza attacks as truce expires, heavy fighting reported

Al Qadir Trust case: NAB files reference against Imran, wife

Inter-bank: rupee records 4th consecutive gain against US dollar

Open-market: rupee continues to strengthen against US dollar

PCB includes Salman Butt in selection panel, decision draws criticism

ECP refutes Babar Awan’s statement about KP’s seats being reduced

COP28: Caretaker PM Kakar arrives at Dubai Expo City